NRO-MOL_2015

Chapter XI - BUDGET, DEVELOPMENTAL, AND SCHEDULE PROBLEMS—1965 - 1966
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and the firm’s “underestimate ‘’ of the time needed to
debug the planned optical test chamber. 15 To eliminate
the first obstacle, Dr. Flax on 4 April asked DDR&E for
authority to proceed with the purchase of the unique
facilities and support equipment needed to develop
the primary optical sensor. Foster quickly approved,
whereupon Flax authorized Martin to sign a contact
with Eastman Kodak and proceed with the necessary
facilities construction. 16
Meanwhile, following the 2 April 1966 management
meeting, the MOL Program Office took another critical
look at the firm’s proposed 15 September 1969 first
manned launch. Working back from the first date, it
became clear to MOL officials that “only 31 months is
available to EKC,” not the 37 months the firm stated it
would need to deliver the camera optical assembly.
The resulting six months gap would therefore slip the
proposed first all-up launch to April 1970. 17
MOL Program officials were thus faced with the fact
that less than eight months after the President had
announced the first manned launch would take place
in late calendar year 1968, it had slipped into calendar
year 1970. This situation was particularly embarrassing
to those OSD and Air Force officials who had recently
testified before Congress. On 23 February 1966, for
example, Secretary Brown told the House Appropriations
Subcommittee: “Our best estimate at this time is that the
first manned flight will not occur prior to mid-1969, which
is a slip of about nine months from what we said last
year.” On 8 March Dr. Foster, also advised the Senate
Armed Services Committee that the first manned launch
would take place “about mid-calendar year 1969.”
Citing the repeated schedule slips in the program,
General Evans on 7 April expressed apprehension to
the MOL Director that there might be “a very adverse
effect on the program as a whole and the Air Force’s
management image.” He said that, if the schedule
slipped further—due to the still unresolved funding
problem—the program might not survive “as a manned
reconnaissance system.” He urged steps be taken to
reduce expenses and that all contractors be advised
“that we have a major cost problem, that we need their
assistance, and that they should be creative in exploring
ways of reducing program costs.” 18
The FY 1967 Budget Review
The MOL budget was already under intensive study
by Air Force officials. In late December 1965, acting on
news that McNamara intended to limit 1967 program
funding to $150 million, General Schriever ordered a
thorough budget review of financial requirements. He
directed Evans to establish a budget review committee
to meet with top contractor officials to analyze the latter’s
cost proposals for Phase II engineering development. 19
Subsequently, Evans proposed, and Flax approved,
establishment of several task forces and senior cost
review boards.
One task force, headed by Col Robert Walling of the
MOL Program Office, consisted of eight officials who
beginning in April 1966 embarked on an intensive review
and evaluation of contractor white financial requirements.
Their results were subsequently submitted to a MOL
Senior Cost Review Board, chaired by Schriever and
including Evans, Stewart, Yarymovych, Major General
G. F. Keeling and Brig Gen W. E. Carter of Headquarters
AFSC and Major General David M. Jones of NASA. The
second task force, chaired by {the} NRO Comptroller,
performed the same kind of review in the black area.
Its membership included three representatives from
the MOL Program Office and two from the Office of
Space Systems. 20 In this area General Martin had major
responsibility for compiling the DORIAN payload cost
estimates. However, because Eastman Kodak and
General Electric could not complete their final Phase
II cost estimates by 1 May, Martin’s DORIAN report
(submitted on 22 April 1966) contained only the “best cost
data” and were subject to change when firm contractor
proposals were received. 21
On 29 April, at a meeting of the MOL Policy Committee,
General Evans presented the results of the above cost
reviews. He reported there was a substantial difference
between the contractors’ preliminary or interim estimates
($2.6 billion) and the Air Force’s estimate ($1.978 billion)
of program costs. Evans reviewed six different program
options for the committee to consider: two of them would
reduce the number of flights by one or two, with program
costs dropping to either $1.817 billion or $1.714 billion. 22
After the briefing, the Committee directed that an
additional seven-shot schedule—two unmanned flights
in 1969 followed by a first manned flight in December
1969 with fully-qualified DORIAN optics—also be
“costed out.” The Committee recognized the difficulties
in getting early delivery of the first qualified optics
package, but still wished to see the first manned flight
take place in calendar year 1969. Concerning the optics